In an ideal world, every homeowner would pay their assessments on time. But we all know the world is far from ideal. Boards of Directors sign delinquency policies and the process is theoretically smooth and simple. So why does it seem to take so long for a homeowner to go all the way through the process to eviction? The short answer is that it’s a process. The long answer explains that process.
Many associations require a first “friendly” notice that assessments haven’t been paid, usually after 30 days delinquent. If still unpaid after 30-45 days, a second “demand” letter is sent. Some associations vary on the timeline, but this is the legally required letter- the one with the big font, warning of legal action if assessments aren’t paid within the time specified in the letter.
At this point, any owner who hasn’t paid is delinquent between 30-90 days already and the association is ready to place a lien. The lien amount can only be for what is 30 days past due. A request for action is sent to the association’s attorney’s office by the Henderson Properties Legal Accounts Coordinator. Typically, it takes about two weeks for the lien to actually be put into place, as it navigates its way through the legal red tape. Some associations include automatic lien to foreclosure phraseology in their delinquency process, which helps make the process more “automatic” on the attorney’s end.
After the lien has been placed on the property by the association’s attorney, typically 30 days later according to delinquency policies, the association is ready to file for foreclosure. According to the North Carolina statutes, the Board of Directors must vote to begin the foreclosure process and sign a document authorizing the association’s attorney to begin that process. When the foreclosure is filed, it takes about two weeks for the foreclosure paperwork to process through the legal system. The homeowner is now almost five months delinquent.
When the foreclosure suit is officially in place, a hearing date is set. This hearing typically takes about 6 weeks from the date of the foreclosure filing. There are legal requirements before the hearing can be held, including notification to the homeowner in very specific forms.
This is where the legal extensions kick in. The Clerk of Court has the ability (since October 1, 2009) to postpone a hearing for another 60 days if they believe there is a reasonable possibility that the homeowner will pay the outstanding amount. This can tack on two more months to a homeowner who is now over six months delinquent.
When the hearing is finally held and if no payment is received, a sale date will be set by the courts. This is at least 21 days from the date of the hearing as again there are legal requirements of notification. After the sale is held, another ten days must pass for any upset bids to come in.
Once that time period has expired, if the association is the high bidder at the foreclosure auction, the process of eviction can begin. A request is filed with the sheriff’s office, legal notification takes place, and an eviction date is scheduled. When the sheriff’s office is overwhelmed with requests, the time frame on this can be anywhere from two weeks to two months, depending on the workload.
If all this accumulated time is tallied up, this process could be as long as nine months to a year until a homeowner is evicted from the property for non-payment of assessments. The good news is that by diligently following the lien and foreclosure process, 88% of all owners that are delinquent pay the outstanding amount of assessments, legal fees and late fees before the foreclosure sale.
While it does happen, it is rare that a homeowner is actually evicted. So while the process is long, it does yield results for the association. It just takes time and patience.